Taxpayers may need to pour billions more into the bailed out banks before the government can start to sell its shares in them, the National Audit Office warns today.

In its second report on the cost of propping up the banking system, the NAO notes that the stipulation for banks to hold more capital may mean extra government cash could be required to prop up Royal Bank of Scotland and Lloyds Banking Group – on top of the £65bn spent on buying their shares.

The report discloses that the government has underestimated the cost of the bailout because it refuses to include the £5bn a year interest on the money it borrowed to purchase its shares and loans to the banks.

"This ongoing cost is material in terms of the overall public finances and deficit," say the NAO. It warns that while so far this cost has been offset by the fees and interest paid to the Treasury by the banks, it expects these fees to fall in the future.

The government's bill for supporting banks has fallen from its peak of £955bn to £512bn but the NAO said the government still needs to wean banks off the range of support schemes implemented during the banking crisis and is likely to be propping up the banks for "years to come".

It reckons the "most likely scenario" is that there will be "no overall loss" on the main schemes – the asset protection scheme used by RBS, the special liquidity schemes or credit guarantee schemes – which is an improvement on the Treasury estimate of a loss of between £20bn and £50bn last year.

Even so it urges the government to review the fees charged for the use of credit guarantee scheme while report on the APS will be published "shortly". In 2011 it will look at the wholly-owned banks Northern Rock and Bradford & Bingley in more detail.

The taxpayer was sitting on combined loss on holdings in RBS and Lloyds of £12.5bn on 1 December, the NAO has calculated. It calculates that for every 10p rise in the shares, taxpayers make an extra £9bn on RBS and £3bn on Lloyds.

Regulatory changes, as well the potential findings of the government's banking commission, could affect the share prices. "Many of the issues being considered, including structural reform and further requirements to capitalise systemically important banks, may well have a material impact on the share price of the publicly owned banks. It is also possible that, as a major shareholder, the Treasury will be called upon to participate in further capital injections into the banks were they to be required," the NAO said.

It notes that the number of Treasury staff working on financial stability has fallen from 108 in December 2008 to 41 now and that this may fall further with public sector cuts.